Employment & Benefits, Shardul Amarchand Mangaldas & Co updates

India

Contributed by Shardul Amarchand Mangaldas & Co
Keeping up with the times: EPF goes digital
  • India
  • 10 July 2019

The employees' provident fund is a social security fund comprising contributions from employers and employees, which are paid to employees on their retirement. The entire process is administered by the Employees' Provident Fund Organisation (EPFO), which is a statutory body established by the Ministry of Labour and Employment. To keep up with digitisation, the EPFO recently updated the process under which subscribers can withdraw and transfer provident funds.

Casting a wider net – ESI rates amended
  • India
  • 03 July 2019

The Employees' State Insurance (ESI) (Central) Rules 1950 were recently amended to reduce the required rates of contribution to the statutory fund maintained by the ESI Corporation for the provision of sickness and health benefits. The aim of this change is to cast a wider net by expanding social security coverage to a larger part of the population. However, news reports indicate that – as is often the case – the change has come under criticism.

To compete or not to compete – that is the question
  • India
  • 19 June 2019

Non-compete restrictions are the tool most commonly used by employers to protect their proprietary interests following the end of an employment relationship, particularly in the case of C-suite employees. However, non-compete restrictions which apply beyond the term of an employment relationship are generally unenforceable in India. That said, this does not mean that employers have no recourse whatsoever.

Supreme Court rules on whether special allowances constitute basic wages for purposes of PF contributions
  • India
  • 24 April 2019

The Supreme Court recently examined whether certain components of an employee's overall salary are subject to provident fund (PF) contributions. As the Supreme Court has clarified that special allowances paid to employees must be included in the calculation of PF contributions, employers should review and analyse their current salary structures to determine any increase in PF liabilities.

Reducing minimum period of unemployment to withdraw provident fund accumulations
  • India
  • 22 August 2018

The Central Board of Trustees of the Employees' Provident Fund Organisation recently approved a proposal to permit provident fund members to withdraw 75% of their accumulations after a period of one month of continuous unemployment instead of two months. The proposal would come into effect when the Employees' Provident Funds and Miscellaneous Provisions Act and the Employees' Provident Funds Scheme are amended.


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